Quick answer
Buy before 30 June when you need the asset anyway, it can be installed ready for use by then, and this year's profit is high enough that bringing the deduction forward helps. Buying in July can suit you when this year's profit is low, next year looks stronger, cash is tight in June, or suppliers discount in July. Either way, the deduction follows the date the asset is first used or installed ready for use.
Key points
- The asset's install date sets the deduction year; June purchases need June installation.
- A deduction is worth more in a high-profit year than a low one.
- June is expensive for cash flow: wages, super and a quarter-end BAS are coming.
- July purchases defer the deduction by a year but can ease June cash flow.
“Buy before 30 June” is repeated so often that it has become a reflex. For some businesses it’s excellent advice; for others it’s a way to spend money at the most cash-strained time of year for a benefit they could have taken later. Here’s how to decide which camp you’re in.
What actually changes on 1 July?
For depreciation, less than it used to. With the $20,000 instant asset write-off now permanent from 1 July 2026, the rules on either side of 30 June are the same. What changes is the income year in which you get the deduction:
- Asset first used or installed ready for use on or before 30 June → deduction in the year ending 30 June.
- Asset first used or installed ready for use on or after 1 July → deduction in the following year.
So the real question isn’t “will I miss out?” It’s “which year do I want this deduction in, and can I afford the purchase now?”
When does buying in June make sense?
June is the better month when:
- You need the asset anyway. It will earn its keep regardless of tax.
- This year’s profit is strong. A deduction reduces taxable income at your marginal rate — for a base rate entity company, 25%. It’s worth more when there’s profit to offset.
- It can be installed in time. No point buying on 28 June if the installer comes in July. See installed ready for use by 30 June.
- Cash flow can take it. Either from reserves or by financing the purchase so working capital stays intact.
When is July the smarter month?
July can be better when:
- This year’s profit is thin. A deduction in a low-profit year saves little tax. Pushing it into a stronger year can be worth more.
- June cash is committed. June and July bring wages, Payday Super contributions, the April–June BAS (due 28 July for quarterly lodgers) and the new financial year’s cost rises.
- Suppliers discount after EOFY. Some dealers clear stock in July once the June rush passes.
- Your installer can’t make June. Better to plan July than to pay in June and install in July anyway.
How do the two options compare side by side?
| Factor | Buy and install in June | Buy and install in July |
|---|---|---|
| Deduction year | Current year | Following year |
| Best if this year’s profit is | High | Low, or next year higher |
| Cash-flow pressure | High (EOFY, wages, BAS coming) | Moderate (after quarter end) |
| Stock and installers | Tight | Easier |
| Supplier pricing | Busy season | Sometimes post-EOFY deals |
| Risk | Missing the install date | Price rises from 1 July |
The last row is worth a moment. Some suppliers review prices from the start of the financial year, and wage-driven costs rise from the first full pay period on or after 1 July. Check whether your quote is held into July. More on this in July cost rises.
Illustrative example: two plumbing businesses
Illustrative only — invented figures, simplified tax assumptions.
Two plumbing companies each plan to buy a $19,000 drain camera and jetter (excluding GST).
- Business A has had a record year. A June install brings a $19,000 deduction into a year with strong profit, reducing company tax by about $4,750 at the 25% rate. It finances the purchase to keep June cash for wages and BAS.
- Business B had a slow year, with taxable profit close to nil. A June deduction would save little now. It installs in the first week of July, takes the deduction next year when profit is expected to recover, and avoids a June cash squeeze.
Same equipment, opposite answers. Both are right for their own numbers. If you’re weighing up the same choice, see if you qualify for funding that keeps your June cash where it’s needed.
Should I finance a June purchase?
Financing is often what makes a June purchase sensible. It lets the asset start earning and the deduction land in the year you want, without draining the cash that pays wages, super and tax in the busiest cash-flow weeks of the year. Property-secured facilities run from $20,000 to $5,000,000; unsecured options for trading businesses typically from $5,000 to $500,000. Compare them on total dollar cost.
And don’t buy purely for the deduction. Our guide to buying just to save tax explains why.
Who should I talk to before deciding?
Two conversations, ideally in April or May rather than the last week of June:
- Your accountant, about which year the deduction is worth more in. They can see your year-to-date profit, likely tax position, any carried-forward losses and the structure of your business. That’s the information that answers the June-versus-July question properly.
- Your supplier, about stock, delivery and installation dates, whether the price holds into July, and whether any post-EOFY offers are planned.
Then, if you’ll fund the purchase rather than pay cash, bring the finance conversation forward so approval isn’t the step that pushes installation past 30 June. Our EOFY 2027 countdown sets out when each conversation should happen through the year.
June or July, get the funding sorted first
Whichever month suits your numbers, the purchase goes more smoothly when finance is arranged before the supplier’s deadline. Our 60-second enquiry doesn’t touch your credit file. It’s read by one team rather than forwarded to a stack of lenders, and a specialist calls to plan around your install date. Please be accurate about the item, price and timing — it’s the quickest way to the right answer.
Frequently asked questions
Is it always better to buy before 30 June?
No. Buying before 30 June only brings the deduction forward if the asset is first used or installed ready for use by then, and bringing it forward only helps if this year's taxable profit is high enough to benefit. If this year is lean and next year is strong, a July purchase can be better.
Does the instant asset write-off threshold change on 1 July?
Not any more. The ATO says the $20,000 threshold is permanent from 1 July 2026 for businesses with aggregated turnover under $10 million, so a July purchase still qualifies — the deduction just falls in the new year.
When is the April–June quarter BAS due?
For quarterly lodgers, the April–June BAS is due on 28 July. The ATO notes that lodging online may give some businesses an extra two weeks to lodge and pay quarterly BAS.
Can I claim the GST on a June purchase straight away?
If you are registered and meet the conditions, you claim the GST credit on the BAS for the period that the rules allow. On a cash basis, that is generally the period you pay; on an accrual basis, generally the period you are invoiced or pay, whichever is earlier.